University of California College of Agriculture Agricultural Experiment Station Berkeley, California COST OF PRODUCING QUEEN AND PACKAGE BEES IN CALIFORNIA R, L, Adams and Frank E, Todd December, 1933 "Contribution from the Giannini Foundation, University of California and the United States Pacific States Bee Culture Laboratory Giannini Foundation Mimeographed Report No, 30 UNl^El^SITY OF CALIFORNIA Digitized by tlie Internet Arcliive in 2014 https://archive.org/details/costofproducingq30adann COST OF PRODUCING qUEEN MD PACKAGE BEES IN CALIFORNIA R. L. Adans^ and Franlc E. Todd^ Contr itution from the Giannini Foundation, University of California and the United States Pacific States 3ee Culture Laboratory (Not for Publication) Introduction. — The Pacific States Bee Culture Laboratory of the United States Department of Agriculture, v/ith the cooperation of the College of ^^riculture of the University, undertook, at the request of the Bee Breeders Association of California, a study of the cost of producing queen and package bees in California, The field ■'vork, following preparation of forms, was conducted during the month of October, 1933, Following record- taking, the various data v.;ere compiled into a composite cost table, indicat- ing the costs, as built up from bee producers' statements. The result of tiiis study comprises the presentation set forth in this text. Number of Records, — Usable records were collected from 22 producers of queen bees, this number including all but 4 of the total number of pro- ducers of queen bees operating during the 1933 season in California, Records were likewise collected from 18 producers of package bees, th.is number of records representing about 90°^ of the total niim.bcr of Calif- ornia producers of package bees operating during the 1933 season. Method of Collecting Data, — Following the formulating of a blank designed to give all required data, a visit was made to the various producers of queens and package bees, and full data collected by the question and ans- v/er method, the information being then duly recorded on the blanks j)r.ovided for the purpose. Practically'' no producers vvere found to be j:eepirl|;/^ic;^r'ds so that reliance upon estimate's, based on their careful consideration of conditions, constitutes the basis for the various data presented and the deductions resulting therefrom. Divisio n of Ls.bor , — Messrs, Frank S. Todd and E, L, Sechrist, work- ing jointly, collected all but three of the various records. These three were taken by Messrs, Todd and R. L. Adams. The blank forms wore dravm up by rir, Frank E, Todd, reviev/ed by ivir , R, L, -i-dams and Mr. E. L, Sechrist, and mimeographed by the College of Agriculture of the University of California, Office compilation of data 'was done by the S'tatistical Department of the Giannini Foundation of the College of Agriculture, University of Cali- fornia, under the direction of Miss Laura Toll, Profes sor of Farm Managem-ont, Agricultural Economist in the Experiment Station, and Agricultural Economist on the Giannini Foundation, \^ Associate Apicultur ist. Pacific Coast Bee Culture Field Laboratory of the United States Department of Agriculture Bureau of Entomology, The final report via.s prepared "by Frank E. Todd and R. L, Adams, Basis of Cal cu lating Costs. — The basis of calculating costs of pro- ducing queens and package bees consisted of determinations of the following: Production and U t i lizat io n: Numher produced during 1933 season, including purchases for resale. Number (a) held for personal use, (h) sold or held for sale, and (c) number discarded. Cost Items ; Interest on and depreciation of equipment. Supplies (sugar, honey, cell cups, queen cages, purchased queens, bee cages, lath, lumber, wire, purchased package bees, postage, telegrams, ??tationery, advertising, etc.) Current expenses (location rents, taxes, insurance, telephone, rent for be«;;S, electric current, etc,) Use of trucks and automobiles. Labor — operator's and hired Av erage Cost : Sum of cost items divided by number of queens or package bees produced. Cos t of Prod ucing Que en Bees (California ),-- The briefed findings arising from this study indicated the follov/ing basic facts and resulted in a composite cost as given in the tabular presentat I'm belov/: Output , 1933 season: Produced : Untested qurons 33,882 Tested queens 142 Breeders (v/hen sold as such) 8 ~64,03'2 COST ITEMS: Cr.pital Items Kind Number Value based on first cost Charge for depreciation Breeder colonies Cell builders Mating nuclei Bar frames Impulse cages Nursing cage 115 400 22,760 200 4 400 : 1,191.00 3,708.00 53,486,00 35,00 10,00 20,00 201.84 1, 320.00 4,438,20 5.75 1.67 1.43 -2- Capital Items (oont'd.) Kind Number Value based on first cost Charge for depreciation Baby nuclei 400 $ 150.00 75.00 Excluders 594 289.40 18,09 Cell protector 50 2.50 0.12 Starters 42 192.00 192.00 Feeders 1,033 238,58 21,69 Press 1 2.50 0,12 Incubat o r s c OU .UU ID ♦ O f Cage holder 10 2.50 0.21 Introducing cages 1,110 276.00 30.00 Ke a t i ng e qu i pme nt 7 100 , 50 8.38 Houses, special 4 91.50 11.44 Transfer in.struments 27 15.50 1,94 Cell cup apparatus 91.50 Total investment (capital items) H^60, 393.98 interest on average capital items at 6% 1, 811.82 Charge to cover depreciation 6, 689.55 (Assumed that labor charge covers whatever repair; to equipment are required.) Supplies ; Kind Amount Va lue Sugar (feed) Honey (feed) Cell cups ';=iueen cages Postage on queens Pov^rdered sugar Labels, cages Invert sugar syrup Hisc. supplies 4,185 lbs. 29,570 lbs. 86,500 (#) 46,558 (#) 44,540 2,288 7,000 Total V 20 1.40 797.60 135.40 1,117.39 472,12 155.00 17.50 134.86 7 5.00 13,105.77 Chargeable to production to marketing 01,209.40 1,896.37 i;?3,105,77 Current ^ Exp en ses; Location rents Taxes Insur anc9 Telephone Electric current Rent of buildings ,^[5292,30 199.00 70.00 78.50 6.75 145,00 2}}IS ® Bxpen ses ( c ont ' d , ) Miscellaneous v215,63 Total 007. 18 IJse_ of_JbruckG^ and aut^mobi lj3^ ; Truclrs Automobiles Number reported 23 Mileage chargeablo to queons 43,025 Weighted average cost per mile 5,6<^ ijnount chargeable 2,404 * Included |82 rentals paid, Labor : Total hours Rate per hour (v/pighted average) Total charge Operator ' s 17,570 44.6,^ §7,939,45 Family other than operator 4,877 28.8/ C>1,421.50 11 22,460 miles 7.7/ 1,806* Idired 8,172 26.9/ ;;,>2, 196.12 TO ILL CILIRGE FOR Li.E0R 011,557.07 Joint Costs: (Note: The follovring items are costs jointly assignable to both queens and package bees, the total being finally assigned equally to each group.) Item ^' rniount Postage and telegrams ^478, 00 Stationery ' 28,00 Adver-feising 1,252,00 Miscellaneous 35.00 Total 11,793,00 imiount assigned to queens 896,50 Cost o f Producing Package Bees (California):-- Basic facts and the com.posite cost of producing package bees are tabulated belovr; 4 Output (1933 season) based on sales: -4. Produced Total pounds of bees 53,74-9 pounds Purchased (for resale) 2,280 pounds TOTi'iL (produced and purchased for resale) 56,029 pounds COST ITEMS: Colon y Expense ; Equipment. Charge : This charge was determined as follovvrs: Item 2-story, 10-frame hives, complete Bees, queens, and brood Chargeable 73% to honey production and 27^^ to package bees, thus: Charge for use of equipment and bees (capital |31,940) © 6% on ave r age investment: Interest 958,20 Charge to cover depreciation of equipment 1^577,07 Charge to cover depreciation of bees and queens 1,251,13 Number Value Charge for dopreciat ion 12,980 (;67,496 ^55,841,00 12,980 59,318 4,633.80 Supplies : 215,000 pounds of honey © Z^: |6,450.00 Labor; 5,192 hours © 53,9;zf, total :^;2,855.60, of which 27^ is chargeable to packaged bees: v771.01 Collecting and Jilarketing Pa ckaged Bees: Capital invested in mar koting items: Charge to Items Number Va lue cover depreciation Sealing itb. chine 4 V 66.00 % 7,10 Package bee cag OS (return) 2,200 361,00 180.50 Screen house 1 5,00 0.83 Scales 21 297.00 19.80 Funnels 30 57.55 5 c 23 Miscellaneous 18 44.00 7,86 Totals $830,55 |221,32 Interest on average capital © &fo on 1830,55: % 24,95 Depreciation of capital items: |221,32 -5- Six pplies for VsiC kag e d Bees (21,491 packages) rrind i'.mount_ 18,880 pounds 21,491 numbers Va lue Sugar Cages (complete) Lath Baling v/ire I.iisce llaneous Total Package "bees purchased for resale: 2,280 pounds if 786.95 2,471,47 186.00 28.00 21.05 :;;i3,493.47 479.75 Que ens (at cost of production; as shc-Arn above) complete with cages but less postage: 21,807 number © 46-ay |10, 140,25 Current Expenses: Location rents (allocated to package boos) Taxes Insurance Telephone Electric current Rent of buildings I.iisce llaneous Total Charge for Truc ks and Automcb i les_ Trucks 0 294.30 276.00 93.00 26.50 33.75 55,00 225.63 ^U, 004. 18 Automobiles Number reported Mileage chargeable to package bees Weighted average cost por mile jjnount chargeable 19 44,841 miles 8^ §3,581.00 4 6,775 miles 5.5^ 0354 * * Includes vl2 paid in rents. Labor : Total hours Rate per hour (weighted average) Total charge Operator ' s 4,712 53.9/ $2,534,90 Fami ly other than operator 1,302 30.8/ § 400.00 Hire d 11,636 26.4/ 03,064.57 -6- TOTAL CK^UGE FOR L^SO'R §5,999.47 Joint C osts : (Note: Tho follovmig cost itorns aro jointly assignable to both paclcago boes and queens, tho total being finall^^ assignod to each group equally,) Itoin jbnount Postage and telegrams O'i78,00 Stationery 28.00 Advertising 1,252,00 Mi s c o 1 1 ane ou s 35.00 Total ^U, 793. 00 ■ ijnount assigned to package bees: |) 896.50 Recapitulation: Tot.:l pounds of package bees 56,029 pounds Pr o C'U ct i on and rne. r ke t ing c o st s : Interest on colony equipment, including bees, queens, and brood; prorated amount to package bees ' y ^958.20 Depreciation of colony equipment, prorated amount to package bees 1,577.07 Depreciation of colony bees; prorated amount to package boos 1,251,12 Labor on colonies; prorated amount to package bees ' 771,01 Honey (used to produce bees) 6,450.00 Interest on capital iteins used in collecting and marketing package bees 24,95 Depreciation of capital items used in collect- ing and marketing package boos 221,32 Current expenses 1,004,18 Purchase of boos for resale 479,75 Charge for use of trucks and autanobiles 3,935,00 Labor in shaking and packaging bees, making cages, etc, 5,999.47 -7- \ Production and marketing costu (cont'd.) Share of joint costs 896.50 Total cost (not including queens or packages) ^23, 568,57 Cost per pound (not including queons or packages) 42.1/ Cost of packages (other than labor — included above) 03,493.47 or 16.2/ each. Cost of queens: './lO, 140.25 or 46^^' per package Total Costs per Package: 2-pound package; no queen $1.00 2- pound package v;ith queen 1.47 3- pound package; no queen 1.43 3-pound package ^.dth queen 1,90 Act ual Sales Pvepor tod : ■ Number P ound s Bees 2- pound packages "TjMS '^'16,890 3- pound packages 12,782 38,346 Miscellaneous sizes — 793 Total 56,029 Comme nts.-- The cost of producing queens and package bees, as set forth above, represents average costs. Later, v/hen time permits, the authors plan a more detailed studjr of the various records, to determine the range in costs by individual producers, together with analyses designed to shov/ variations in cost items, and possibly suggestions that can be utilized by beekeepers in the conduct of their business. In the meantime, however, one should bear in mind that an average cost does not necessarily set the price that producers should receive if they are to continue in business for the reason that the demands for queens and package bees may be such that if a price vrere set merely at the average, producers operating at costs above the average might be forced out of business vvrith a corresponding reduction of available queens and package bees. It is the authors' opinion that a price to maintain production to the required maximum must be set above the aver- age but at v,rhat figure only an intensive study of the individual records v/ill determine. Only such a study vdll give the "bulk line cost" neces- sary to bring forth the required niimbers of queens and package bees. If time permitted, this information iTould have been submitted as it has a very evident and definite bearing upon the v^iole problem of what prices should be set in order to insui-'e sufficient supplies to take care of all marlcet demands , Tiie costs presented above do not provide for interest other than on equipment j thus interest (to cover use of capital in addition to equipment) a?id any sum to represent profits are to be added in a final determination of a selling price. -8- Appendix A QUEEN AND PACKAGE BEE PRODUCTION COST SUIWEY METHODS OF PRODUCT ION 1. Queen production season 193S to ■ , 1933. Normal 2. Average dates; first queen ; first orders last queens ; last orders 3. Date bees v/ere returned to honey production Yiow much crop loss 4. Breeding stock: nuiaber ; origin 5. How do you care for breeding colony Item Cell building colony _ — .,- Nuc lei Number used How prepared — — 1 1 1 . _~ . — ^ — . . — ■ . ■ — _ — . How IS bee suren^th maintained — . — . — . Cell removed in no. days, etc. Queens removed; vrhen and how, etc. "/hen are nevj" cells edd- ed No. inspections per batch (reason) No. handlings each queen and purpose 7. Cell cup preparation method 8. Method of starting cells 9. Grafting method: Dry ; Royal jeliyj pure , diluted ____ 10. liow is drone supply provided 11. No. cel3.s pir batch ; No. queens per nuclei per season Percentage cells com.pleted acceptance in nuclei : Queens fo^ripe cells % Percenta^-^e of good queens per batch %, Normal percentage % PACxlAGE _ BEES ~~ ' "~" ~ 1. Season , 1933 to , 1933. Normal season 2. Number colonies supplying picgs. .Do you buy bees . Ave. lbs. per col 3. Percentage honey crop lost by sale peg. be,'S %. 4. Hovf long ht ve you shipped: Pkg. bees yrs. '-.uyens yrs. 5. Do you exclude drones How much ov:rweight Eixtra queens SHIPMENTS i.:ueon pric^-s "] Pac',-: ago 'ha,, prices Year Queens 1 to Over j 1 Plcg. bees 2 lbs. "ijith quoon 3 lbs. "^ /ith que on Others 1935 ., ^ J.:.. 1932 ■ 193 f 1930 1929- 1928 1927 ■ 1926 1925 l-9Tr PRODUCTION RECORD 1933 Item 1 Produced Number purchased Total No. sold Ave . unit price Gross receipts^ _ Untested queens | Tested queens Breeders Used at home ■ Held for sale Unsold - discarded Package "bees, 2 lbs. 2 lbs. with queen Package bees 3 lbs. 3 lbs. -with queen Orchard packages Other sizes No. queen replaced on buyers demand, 1933 ________ • Expense . Bad collections. Queens: No. ; Amount Number package beoif claims, 1933 ; Replaced pkgs. _________ Expense Bad collections: pkg. bees; No. . Amount Express refunds Is above usual situation? Claims , queens sold Pkg. bees sold INVENTORY OF SPECIAL EQUIPMENT 1. Total no« colonies operated j No. used in queen prod. ; Pkg. bee prod. . Item No. Unit price Total ■value Age Remain- ing life Breeder colonics Full colonies Cell builders Mating nuclei Excluders Feeders Incubators Cell cup apparatus Introducing cages Heating equipment Transferring inst. Cell protectors Houses (special) Breeder queens Funne 1 s Pkg. bee cages ( returnable ) i — LABOR RECORD Itom Month Crow Op rat or ■ and f ami ly Hired he' -p ^ Daye ' Ers . Tot all Rate iiirit . Days Hr s . Total Rate Prop, queon colls Prop, nuclei Caring for colonics Prep, colls Transfsr. larvae Introducing cells Caging queens Preparing feed Feeding Preparing candy Mailing queens Office work. Inspections ~ — ' - Shaking bees and shipping Preparing cages Preparing feeders Preparing syrup ^ — ^_ u. .. 1 - — -r- ■ ~H — — CO PQ o o 9^ Time of operator against queens Time of family against quo ens Timio of hired help against queens Normal vrage : Operator ; Family days; Package bees days; Package bees days; Package bees ; iiirod help days days days ■ J... JOINT , P.:\CT:.CtE BEi'iS CUEEN PRODUCTION Personal j Circular letter i 03 (D d- ti H o y rt S» c+ h' O ►3 CD 1 Postage & telegraph! ' c 05 O CO rf CD :'D Ui ■rt • H •-s (Ti rr 05 t— 1 H- % O — IT* d- 1-5-' ! Bee cages (coinpletej ;o '1 '•d • (D CD CD CD CD « ■'d i-j o CD j Postage on cueens ; ^ ueen cages i 2- — , i Cell cups 1 \ "ioney (feed ) j p •-^ CD CD ™ ■d- CD 3 1 1 — — • — — I d a d i. J. O d- CD d <! CD d ., — \ d P o CD h-i d- O ^•j — ' — . — — — - i- — O d ; CO CO T) " — — ' — d' a •d d o CD P O C „) CD db ' — — — — o' • — — -— — _„ ■ d C3 d d O d- 0) cd C/3 '■D O d P d "~" =^ -a P o r-- d id P CD M o' • — - — d d 1-1. a ci- I'D , <J 1-3 ■y> o I-' cd CD I—' CO i ■ \ ' ' . ' ' • ; . ; • . '• '■ CURBErlT EXPENSES PackagG bees ^ ± OX 1 — .. . — ^. . — — 1 Oil a ± „.„: , . „.. . ^ . , — — . — . . .-^ . ^.^.^ , — • — — — T i""^ 1 p "nVi nn p *—*——■ '— ' Tn+-F-r' 'st ( E'fcT) - — ~ — ^. ^ _ . . . ™™ TVi^'TtH "Fdt "hp '"^ r — — , — . — — ^ Eloc"trio curroiit; TRUCK MD AUTO .EXPENSE Truck Auto Make 1 Size 1 MiluagG truvolGd, 1933 j % to Togs ! " % to queen ! " % to pt.ckfc-ge boos AvGr;\go mil OS p<jr year | MILEAGE Item Mi les No. trips _| Total miles Truck '1' Auto Round'irip to queen yo.rd 1 i I Post office trips r— 1' i ^ 1 ^ ^ 1 Express Co. trips Trips to obtf.in pack- age be^js . _i ! i ' ' ■ — — ■ ■ — — ■ ; — . , . . , — — ^ 1 i , 1 i , , _„ Appendix B, Past Pricos Received frora Sale of_^eens Singles Lot sales 1933 35/ - 65/ 28/ - 65/ 1932 60 - 85 32 - 75 1931 60 -yi.oo 40 - 75 1930 60 - 1.25 50 -^1,00 1929 75 - 1.25 50 - 1.00 1928 75 - 1.25 50 - 1,00 1927 75 - 1,25 60 - 1.00 1926 75 - 1.25 90 - 1.00 1925 75 - 1.25 90 - 1*00 Appendix C, Past Prices r:eceived from .Sale of Po.ckage Bees (with queen) 2-lb, pl:g . 3-lb. P--£ • 1933 Cl.20 - 1,80 Cl.60 • -2.50 1932 1.20 - 1,85 1.60 . - 3.30 1931 1.20 - 2.50 1.60 ■ - 3.90 1930 1.20 - 3.00 1.60 ■ - 3.50 1229 2.25 - 2 . 50 2,50 - - 3.50 1928 2.25 - 2,60 3cOO ■ - 3.25 Tho total shipraents of Calif orni.i queens and pac?:age bees, 1933, T;ere as follows: "iueens Pacjcage bees nuaber^ pounds P£2]S£:£^^ Commercial sales 49,316 67,029 25,890 Shipments to enterprises located in other states 2,890 8,675 3,470 by California branch of same 52,206 75,704 29,360